Solar and wind companies started fleeing Australia after its former government cut back on their taxpayer-support, and the country’s new administration isn’t coaxing them back.
Green power isn’t cost competitive with other sources, so investment in new Australian wind and solardropped 31 percent when the government leveled the energy playing field by ending a portion of the country’s energy subsidies and special financing for ‘green’ power.
Former Prime Minister Tony Abbott’s government repealed Australia’s carbon tax, reduced the mandatory renewable energy target, announced plans to study the health impacts of wind farms, and slowed $10 billion in special financing for ‘green’ power.
The leader of the Australian Green Party even accused Abbott of “vindictive industrial sabotage” and said that the former PM was trying to “handcuff” Australia to the coal and gas industry. Abbott is so despised by environmentalists for his actions that Greenpeace has an entire section of its website dedicated to the former Prime Minister.
Thus, environmental groups rejoiced when Abbott lost a leadership challenge in September to Malcolm Turnbul, a member of his own party. However, the new prime minister has refused to support special financing through the Clean Energy Finance Corporation and seems set to continue not granting such financing to wind power.
“Governments have created a policy mess that should never be repeated.” said the Grattan Institute, a politically non-aligned Australian government think tank, when describing how solar power subsidies used to work in Australia.
Solar subsides in Australia were so large that leasing companies would install rooftop solar systems, which typically cost $10,000, at no upfront cost to the consumer in exchange for the company getting exclusive access to generous subsidies, rebates, and other incentives. The Grattan Institute estimates that the Australian government wasted $9.3 billion on solar subsidies, more than half of the $18.3 billion it spent on those subsidies.
Solar and wind power produced 2.1 and 4.2 percent respectively of all the electricity Australia generated in 2014.
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